Hoegh LNG books Q2 loss

Norwegian floating storage and regasification (FSRU) supplier Hoegh LNG moved to a loss in the second quarter, blaming the result on seasonal variations and dry-docking costs.

The company reported on August 22 a net loss of $3.6mn for the three-month period, versus an after-tax profit of $7.8mn in the same period of 2018. Total income was relatively stable at $75.5mn, down from $75.8mn a year earlier.

“Hoegh LNG’s results for Q219 are negatively affected by seasonal variations and dry docking costs,” CEO Sveinung Stohle explained. “Adjusted for these effects, our underlying numbers are in line with previous quarters.”

Reflecting on the path forward, Stohle noted that the LNG market was continuing its rapid expansion, growing by 16% in the first half owing to the ongoing transition from coal to gas in the power sector, as well as ample supply.

“This is further reflected by the important progress being made on all FSRU projects where the company is already selected as the FSRU provider or has won exclusivity, he said predicting that Hoegh’s entire FSRU fleet would be engaged under long-term contracts by the end of 2021.

Hoegh struck new charter deals for its Galleon and Esperanza units during the quarter, and is finishing up construction of its Gallant vessel. It also entered “exclusivity” talks for the supply of an FSRU to Australian Industrial Energy’s Port Kembla gas terminal project, where a final investment decision (FID) is anticipated this year, along with a second for an unnamed Asian project, where the charterer is currently acquiring permits.

Hoegh is looking to branch out into the market for smaller LNG projects in a bid to diversify. It has six small-scale LNG carriers with bunkering capabilities under construction, due to deliver in 2019-2021.